When parents go through a separation or divorce, one of the most critical aspects to address is the custody of their children. In some cases, parents agree to a split custody arrangement, where each parent has primary care of one or more of their children for a specified amount of time. While this arrangement can work well for the family dynamic, it introduces several complexities when it comes to tax claims. Navigating the tax implications of split custody can be a challenge for many Canadian parents, especially given the rules set forth by the Canada Revenue Agency (CRA).
Understanding how to maximize tax benefits, avoid common mistakes, and ensure both parents are treated fairly by the tax system is essential. This guide will explore the ins and outs of split custody tax claims, from how the CRA defines split custody, to claiming benefits like the Canada Child Benefit (CCB), and addressing key deductions. By taking the right steps, parents can avoid disputes with the CRA and ensure they are making the most of their tax situation.
Defining Split Custody for Tax Purposes
Legal Definition of Split Custody
Before delving into tax benefits and claims, it’s crucial to understand how split custody is defined by the Canada Revenue Agency (CRA). Many parents might be familiar with the term “joint custody,” but split custody carries a distinct meaning when it comes to taxation.
In Canada, split custody occurs when parents share physical custody of their children, but each parent is responsible for one or more children for a significant portion of the year. This differs from shared custody, where both parents have equal or near-equal time with all children. For tax purposes, the CRA distinguishes split custody based on how much time a child spends with each parent and how financial responsibilities are divided between them.
Key Aspects of Split Custody
- Division of Children: Split custody involves a scenario where one parent may have primary custody of one or more children, while the other parent has custody of the remaining children.
- Financial Responsibility: Each parent is responsible for covering the costs of the children under their care, including day-to-day expenses, school fees, and other necessities.
- Equal Custody Periods Not Required: Unlike shared custody, where both parents have roughly equal custody periods, split custody can involve different arrangements depending on the family’s circumstances.
The CRA treats these scenarios differently in terms of benefits and tax claims, making it important for each parent to understand their specific situation and how it impacts their tax filings.
Key Tax Benefits for Parents with Split Custody
Canada Child Benefit (CCB)
One of the most significant benefits available to parents with split custody is the Canada Child Benefit (CCB). This is a tax-free monthly payment intended to help with the cost of raising children. However, when parents share custody, the benefit is usually split between them, based on the percentage of time each parent has custody of the children.
In split custody, where each parent has one or more children for a significant part of the year, both parents may be eligible for separate CCB payments for the children they care for. This can provide substantial financial relief, especially when the number of children per household varies.
Tax Credits and Deductions
In addition to the CCB, parents with split custody can also benefit from various tax credits and deductions, such as:
- Eligible Dependent Credit: In some cases, each parent can claim the eligible dependent credit for one or more children in their care. This credit is significant, as it reduces taxable income, helping parents lower their overall tax burden.
- Child Care Expense Deduction: If a parent incurs child care expenses (e.g., daycare, nannies, or after-school programs), they may be able to claim these costs as deductions, provided they meet the CRA’s requirements.
- Medical Expenses: Parents can also claim medical expenses for their children, even in split custody situations, provided they are the ones who paid for the medical services.
Impact of Custody Agreements on Claiming Dependents
Custody agreements play a crucial role in determining who can claim certain benefits and credits. The CRA considers the terms outlined in these agreements, so it’s essential that parents are clear on their roles and responsibilities when it comes to tax filing. Without a well-defined custody agreement, disputes can arise over who gets to claim dependents or access specific tax benefits.
Understanding the available tax benefits and how they apply in split custody arrangements is key to optimizing financial outcomes for both parents.
Canada Child Benefit (CCB) and Split Custody
How the CCB is Calculated for Split Custody Parents
In split custody arrangements, where each parent has primary custody of one or more children, the CRA takes a flexible approach to calculating the CCB. Each parent is eligible to receive the CCB for the children in their care, but the benefit is divided based on the time spent with each child. Since split custody usually involves one parent caring for specific children for the majority of the year, the CRA may provide distinct payments for each child, depending on the parent who claims them.
This means:
- Separate Payments: Each parent will receive separate payments for the children under their care. The amount is determined by the CRA based on factors such as income, number of children, and the amount of time the child spends with the parent.
- Income Considerations: The amount each parent receives is calculated individually, based on their income. A parent with a lower income may receive a higher CCB payment for the child in their custody, even if the other parent earns significantly more.
Division of Benefits Between Parents
The CRA automatically adjusts the CCB payments to account for split custody. This means that each parent will receive their share of the benefit without needing to negotiate between themselves. However, it’s crucial for parents to ensure that their custody arrangement is properly documented and submitted to the CRA, so that each party receives the appropriate benefit.
For example:
- Parent A has custody of two children for six months of the year, while Parent B has custody for the other six months. In this case, the CCB payments for each child will be split, ensuring that both parents receive a portion of the benefit proportional to their custody time.
- Parent A has sole custody of one child, while Parent B has sole custody of another. In this case, the CRA will provide separate payments for each child, with each parent receiving the full benefit for the child in their custody.
Real-Life Scenarios of CCB Distribution
To illustrate the complexity of split custody CCB distribution, consider a family where two children are involved. If one child spends 60% of their time with Parent A and 40% with Parent B, the CRA may allocate 60% of the CCB to Parent A and 40% to Parent B. However, if the second child spends more time with Parent B, the distribution for that child could differ, further complicating the calculations.
These kinds of variations make it essential for parents to clearly track their custody arrangements and communicate with the CRA about any changes in their living situations, ensuring that both parents receive their fair share of the CCB.
Claiming Dependents and Eligible Tax Deductions
Claiming Dependents in Split Custody Situations
When parents share split custody, both may be eligible to claim dependents on their taxes, but only one parent can claim each child per tax year. This can sometimes lead to confusion or disagreements between parents, especially when there are multiple children involved. Generally, the CRA allows the parent who primarily cares for the child to claim the dependent, but in split custody, where both parents have a child for a significant part of the year, each parent may be able to claim one or more children.
For example:
- Parent A claims Child 1 as a dependent for tax credits and deductions, while Parent B claims Child 2.
- If both parents attempt to claim the same child, the CRA may intervene and request documentation or proof of the custody arrangement before resolving the issue.
Medical Expenses, Education, and Child Care Deductions
In split custody situations, the parent who incurs certain expenses (such as medical bills, education costs, or child care fees) is typically the one entitled to claim these deductions. However, it’s important for parents to maintain clear records of who is paying for these services, as the CRA may ask for proof during an audit or tax review.
Child Care Expense Deduction: The parent who pays for the child’s daycare or after-school programs can claim these expenses on their tax return, provided they meet the CRA’s criteria. This deduction helps reduce taxable income, offering significant savings for working parents.
Medical Expense Deductions: Medical expenses, including dental care, prescription medications, and therapy services, can be claimed by the parent who covers these costs. It’s crucial for parents in split custody arrangements to track their medical expenses, as they can add up quickly and provide valuable tax relief.
Education Deductions: If a child is enrolled in post-secondary education, the parent responsible for tuition payments and other educational costs may be able to claim these on their taxes, provided the child qualifies for the relevant credits and deductions.
Step-by-Step Guide for Parents Navigating Dependent Claims
- Document Custody Agreements: Ensure that your split custody arrangement is clearly documented and agreed upon by both parties. Submit this agreement to the CRA if needed to avoid confusion.
- Determine Who Will Claim Each Child: Decide, based on your custody arrangement and financial situation, which parent will claim each child for tax credits and deductions.
- Track Child-Related Expenses: Keep receipts and documentation for child care, medical bills, and educational expenses throughout the year. This will help ensure accurate deductions when filing taxes.
- Communicate with Your Co-Parent: It’s crucial to communicate regularly with your co-parent about tax claims to avoid both parties claiming the same child, which could trigger an audit or CRA intervention.
By following these steps and keeping detailed records, parents in split custody arrangements can ensure they make the most of eligible tax deductions while avoiding potential disputes.
Shared Custody vs. Split Custody: Tax Differences
Defining Shared Custody
Shared custody occurs when parents share equal or near-equal time with their children. According to the CRA, shared custody typically involves each parent having the child at least 40% of the time over the course of a year. This arrangement means that both parents take on roughly equal financial responsibility for the child’s upbringing.
Tax Treatment of Shared Custody
In shared custody situations, certain tax benefits, like the Canada Child Benefit (CCB) or dependent credits, are often split between the parents based on the amount of time they spend with the child. The CRA typically divides benefits equally or in proportion to the amount of time each parent spends with the child.
Split Custody and Its Tax Implications
In split custody, the arrangement differs because each parent is responsible for one or more children full-time. This means that the tax treatment also differs from shared custody, as each parent claims tax benefits independently for the children they care for. In split custody:
- Each parent may claim tax credits and deductions for the child(ren) in their custody.
- There is no need to split benefits like the CCB, as each parent is solely responsible for the financial costs associated with the children they care for.
- The CRA treats each parent’s claim separately, based on their custody of individual children.
Case Studies: Shared vs. Split Custody Tax Implications
Let’s look at two hypothetical families to highlight the tax differences between shared and split custody:
- Family 1: Shared Custody
- Parents A and B share custody of their two children, with each parent having the children 50% of the time. In this case, the CRA splits the CCB between both parents, and both parents claim eligible tax credits for the children. Each parent may be responsible for paying a portion of the child care or medical expenses, and these costs can also be shared between the two parties for tax purposes.
- Family 2: Split Custody
- In split custody, Parent A has full custody of Child 1, while Parent B has full custody of Child 2. As a result, Parent A can claim the CCB, child care expenses, and medical costs for Child 1, while Parent B claims these same benefits for Child 2. In this scenario, there is no need for the CRA to divide benefits between parents, as each parent is solely responsible for their child.
Tax Planning in Shared vs. Split Custody
Parents need to carefully consider their custody arrangement when planning their taxes. Those in shared custody need to coordinate with their ex-partner to ensure they are not double-claiming dependents or tax benefits, while split custody parents have more flexibility to independently claim deductions for the children they care for. The key is to understand your arrangement and ensure that the CRA has accurate information to avoid mistakes.
Common Tax Mistakes in Split Custody Claims
Double-Claiming the Same Dependent
One of the most frequent errors parents make in split custody arrangements is both attempting to claim the same child as a dependent. The CRA does not allow two individuals to claim the same dependent, even if custody is split. If both parents mistakenly claim the same child, it can trigger an audit and lead to the CRA requesting that one parent amend their return.
How to Avoid: Communicate with your co-parent and establish clear agreements about who will claim each dependent. Consider including this in your custody or separation agreement to avoid misunderstandings.
Failing to Update the CRA with Custody Changes
Custody arrangements can change over time, but failing to inform the CRA of these changes can lead to incorrect benefits being issued or missed opportunities to claim certain tax deductions. The CRA relies on accurate information regarding custody to distribute benefits like the CCB fairly. If your custody agreement changes, you must notify the CRA immediately.
How to Avoid: Keep the CRA updated with any changes in custody arrangements, including changes to the number of children in your care or adjustments to the time they spend with each parent.
Misunderstanding Eligibility for the Canada Child Benefit (CCB)
Parents often assume that both are entitled to full CCB payments in split custody, but this isn’t the case. The CRA allocates CCB payments based on the percentage of time a child spends with each parent. Misunderstanding this can lead to incorrect claims and, in some cases, an overpayment that the CRA will later seek to recover.
How to Avoid: Make sure you understand the CRA’s guidelines for the CCB in split custody. Use the CRA’s CCB calculator or consult a tax professional to ensure you are receiving the correct amount.
Failing to Track Expenses Properly
Medical expenses, child care costs, and other child-related deductions must be properly documented and tracked. In split custody, these expenses are often shared between parents, and failure to keep track of who paid for what can lead to missed deductions or disputes during tax time.
How to Avoid: Keep detailed records of child-related expenses throughout the year, including receipts, invoices, and payment records. Clear communication with your co-parent regarding who is paying for which expenses will help ensure accurate tax filings.
Not Consulting a Tax Professional for Complex Situations
While many parents feel confident filing their taxes independently, split custody arrangements can add significant complexity to the process. Failing to seek advice from a tax professional can result in missed deductions, incorrect claims, or filing errors that could trigger an audit.
How to Avoid: If you are unsure about any aspect of your split custody tax filing, it is best to consult with a tax professional who can guide you through the process and ensure compliance with CRA rules.
Inaccurate Reporting of Income for Benefit Calculation
The CRA uses household income to calculate benefits like the CCB. Inaccurate reporting of income can lead to incorrect benefit amounts, which may need to be repaid later.
How to Avoid: Ensure that your income is reported accurately on your tax return, and provide the CRA with updated financial information if your circumstances change, such as receiving additional income or moving in with a new partner.
Real-Life Case Study: A Split Custody Tax Scenario
To better understand how tax claims work in split custody situations, let’s look at a hypothetical case study involving two parents, Sarah and Mark, who share split custody of their two children, Emily and James. This scenario highlights the complexities involved and demonstrates how the CRA’s rules play out in practice.
The Situation:
- Sarah and Mark recently divorced and agreed on a split custody arrangement. Sarah has custody of Emily, while Mark has custody of James. Both parents have equal financial responsibility for their respective children.
- Sarah’s annual income is $50,000, while Mark earns $75,000. Both parents want to ensure they receive all the tax benefits and credits they are eligible for.
Step 1: Claiming the Canada Child Benefit (CCB)
Sarah and Mark both need to apply for the CCB. Since Sarah has custody of Emily and Mark has custody of James, the CRA will assess each parent’s individual income to determine the CCB payments for each child.
- Sarah’s CCB: Since Sarah has a lower income, she is eligible for a higher CCB payment for Emily. The CRA calculates the payment based on her income of $50,000.
- Mark’s CCB: Mark’s CCB payment for James is lower due to his higher income, but he still receives a portion of the benefit, as the CRA adjusts for his $75,000 income level.
Step 2: Claiming the Eligible Dependent Credit
Since Sarah has primary custody of Emily, she can claim the eligible dependent credit on her tax return, reducing her taxable income. Mark, on the other hand, claims James as a dependent, which also reduces his taxable income.
- Sarah’s Credit: The eligible dependent credit helps Sarah reduce her overall tax liability, offering much-needed relief as a single parent with custody of Emily.
- Mark’s Credit: Similarly, Mark benefits from the eligible dependent credit, lowering his tax burden for the year.
Step 3: Claiming Child Care and Medical Expenses
Both Sarah and Mark incurred child care and medical expenses throughout the year. Sarah paid for Emily’s daycare while Mark covered medical expenses for James.
- Sarah’s Child Care Expenses: Sarah is eligible to claim the child care expense deduction for the amount she paid toward Emily’s daycare. This deduction helps reduce her taxable income further, providing significant savings.
- Mark’s Medical Expenses: Mark claims the medical expenses he paid for James, including dental and prescription costs. By tracking these expenses carefully, Mark can reduce his taxable income.
Step 4: Navigating Potential Disputes
During the year, Sarah and Mark had a disagreement about claiming the eligible dependent credit for Emily. Both wanted to claim her, but since Sarah has primary custody, the CRA ultimately allowed Sarah to claim Emily as a dependent. Mark claimed James instead, resolving the dispute. This highlights the importance of clear communication and understanding between co-parents when it comes to tax claims.
Outcome:
By following CRA guidelines and coordinating their tax claims, Sarah and Mark were both able to benefit from the CCB, eligible dependent credit, and deductions for their respective children. They avoided common pitfalls like double-claiming a child or missing out on eligible credits.
This case study illustrates how split custody parents can navigate the complex tax system, ensuring both parties receive the financial benefits they are entitled to while avoiding disputes or errors.
CRA’s Guidelines and Policies for Split Custody
Official Definition of Split Custody by the CRA
The CRA defines split custody as a situation where parents have custody of one or more children, but each parent primarily cares for one or more children for a significant period of the year. This arrangement is different from shared custody, where both parents share responsibility for all the children equally or nearly equally throughout the year.
The CRA’s definition is important because it influences the way tax credits, benefits, and deductions are distributed between parents. The agency requires documentation of the custody arrangement, especially in cases where disputes arise or where parents disagree on the allocation of tax benefits.
Filing Requirements for Parents in Split Custody
When filing taxes in split custody situations, the CRA expects parents to:
- Clearly identify which children are under each parent’s care.
- Ensure that only one parent claims each child for dependent credits, child care expenses, and other child-related deductions.
- Report any changes in custody arrangements immediately, especially if these changes affect the division of benefits or custody responsibilities.
Important CRA Policies on Tax Benefits and Custody
The CRA has implemented several key policies to guide parents in split custody arrangements:
- Canada Child Benefit (CCB): As previously mentioned, the CRA divides CCB payments based on the child’s living situation. Each parent is responsible for claiming the CCB for the child under their care. It’s critical to ensure that custody periods are documented accurately to avoid discrepancies.
- Eligible Dependent Credit: The CRA allows each parent in a split custody arrangement to claim the eligible dependent credit, provided they have primary care of the child for whom they are claiming the credit.
- Child Care Expenses: The CRA permits parents in split custody to claim child care expenses for the children in their care, provided they meet the standard requirements for claiming these deductions.
What Happens if There’s a Dispute?
Disputes over tax claims can arise in split custody arrangements, especially when both parents attempt to claim the same benefits. The CRA has clear protocols in place to address these situations. If both parents file for the same dependent or benefit, the CRA may:
- Request Documentation: The CRA will ask both parents to provide custody agreements, documentation of time spent with the children, and evidence of financial responsibility.
- Disallow One Parent’s Claim: In cases where both parents claim the same dependent or benefit, the CRA will typically allow the claim for the parent who has primary custody of the child, based on the documentation provided.
Resources for Split Custody Tax Filings
The CRA offers several resources to help parents understand their tax obligations in split custody situations:
- CRA’s Official Website: The CRA’s website provides detailed guidelines on split custody, including how to claim dependents and apply for benefits like the CCB.
- Tax Filing Help: Parents can also seek assistance from the CRA’s helpline or consult a tax professional to ensure they comply with CRA rules.
By adhering to the CRA’s policies and ensuring that custody arrangements are documented accurately, parents can avoid disputes and ensure they receive their rightful benefits and credits.
Frequently Asked Questions (FAQ)
What happens if both parents claim the same dependent?
If both parents claim the same child as a dependent, the CRA will typically disallow one of the claims. The agency will likely request documentation from both parents to determine who has primary custody of the child. Once custody is established, the CRA will allow only the parent with primary custody to claim the dependent. It is essential to coordinate with your co-parent to avoid double-claiming, as this can lead to audits and delays.
How are child care expenses divided in split custody?
Child care expenses can only be claimed by the parent who incurs the cost of child care, regardless of the custody arrangement. In split custody, if both parents pay for child care separately, each parent can claim the expenses they paid for their respective child. However, if only one parent pays for child care, that parent alone is eligible to claim the deduction. Keeping detailed records of these expenses is critical to ensure accurate claims.
Can both parents claim medical expenses for a child?
Yes, both parents can claim medical expenses for a child, but only for the costs that each parent paid. In split custody, if each parent pays for different medical services or bills, they can claim those amounts on their individual tax returns. As with child care expenses, it is important to maintain receipts and records of medical expenses to substantiate the claims if the CRA requests documentation.
How do custody changes during the year impact tax claims?
If custody arrangements change during the year, it’s important to notify the CRA as soon as possible. Custody changes can affect the distribution of benefits like the Canada Child Benefit (CCB) and which parent is eligible to claim the child as a dependent. Parents should also ensure that their custody agreement reflects any changes in responsibilities to avoid disputes when filing taxes.
Can I split the Canada Child Benefit (CCB) with my co-parent?
In split custody, the Canada Child Benefit (CCB) is typically divided based on the custody arrangement. Each parent can receive CCB payments for the child or children in their care. If both parents have equal responsibility for a child, the CRA will divide the benefit between them. However, the CCB is not “split” per se—each parent receives their payment for the children they are responsible for according to the custody agreement.
What should I do if the CRA disallows my claim?
If the CRA disallows a claim related to split custody, such as for a dependent or a benefit like the CCB, you have the right to dispute the decision. First, review the CRA’s decision and the documentation they relied upon. If you believe the decision was incorrect, you can file an objection with the CRA. It may also be helpful to consult a tax professional who can assist with the appeal process.
Can I claim tuition or education-related deductions for my child in split custody?
Yes, parents in split custody can claim tuition or education-related deductions, but only for the child in their care. If both parents are financially responsible for different children’s educational expenses, each can claim the appropriate deductions. The key is ensuring that each parent is paying for the education costs of the child they are claiming.
What if I forget to claim an eligible credit or deduction?
If you forget to claim an eligible credit or deduction, you can still amend your tax return after filing. The CRA allows taxpayers to request adjustments to their returns, so if you realize that you missed a claim, it’s not too late to correct it. You can submit an amended return online through the CRA’s My Account portal or by mail.
How do I prove my custody arrangement to the CRA?
In cases where the CRA requests proof of custody, you may need to provide documentation such as a court order, legal custody agreement, or any other written agreement that outlines the custody arrangement. You can also submit records of where the children live, including school or medical records, to substantiate your claim. Providing these documents when requested ensures that the CRA processes your tax claims correctly.
Can I claim legal fees related to custody arrangements?
In some cases, legal fees incurred to establish child support or custody arrangements can be claimed as a tax deduction. However, this applies mainly to fees paid to obtain or enforce child support payments, not general custody agreements. It’s advisable to consult a tax professional to understand if your specific legal fees are deductible.
Actionable Tips for Split Custody Tax Claims
1. Communicate Clearly with Your Co-Parent
Effective communication with your co-parent is crucial when navigating tax claims in split custody arrangements. Both parents need to be on the same page regarding who will claim dependents, eligible credits, and deductions. Clear agreements help prevent double-claiming and reduce the risk of disputes or audits by the CRA.
Tip: Consider creating a shared document or calendar to track custody schedules, expenses, and which parent will claim specific tax benefits each year.
2. Keep Detailed Records of Child-Related Expenses
Whether it’s child care, medical bills, or education costs, keeping detailed records of all child-related expenses is essential. In split custody, these expenses can be shared or divided, so maintaining receipts, invoices, and payment confirmations will ensure accurate tax filings.
Tip: Use a dedicated folder (either physical or digital) to store all receipts and documentation related to your child’s expenses. This will help streamline the tax preparation process and provide proof if the CRA requests verification.
3. Understand the CRA’s Guidelines
The CRA has specific guidelines for parents in split custody situations. Take the time to review these rules to ensure you understand how benefits like the Canada Child Benefit (CCB) are divided and what credits you’re eligible to claim.
Tip: Visit the CRA’s official website regularly to stay updated on any changes to tax rules related to custody arrangements. If you’re unsure about a specific rule, consider consulting a tax professional.
4. Establish a Custody Agreement and Submit it to the CRA
Having a formal, written custody agreement in place is crucial for avoiding disputes and ensuring accurate tax claims. This agreement should outline which parent has custody of each child and detail any shared responsibilities, such as medical expenses or child care costs.
Tip: If there are changes to your custody agreement, notify the CRA immediately. Failing to do so could result in delayed or inaccurate benefit payments.
5. File Taxes Early to Avoid Disputes
Split custody arrangements can sometimes result in disputes between parents over who gets to claim certain tax benefits. To avoid these issues, it’s a good idea to file your taxes early. By doing so, you can claim your eligible benefits and credits before any potential conflicts arise.
Tip: If you know that your co-parent may try to claim the same dependent, communicate with them beforehand to resolve any differences. Filing early also gives you time to correct any issues that might arise.
6. Use Online Tools and Resources
There are numerous online tools and resources available that can help parents in split custody arrangements track expenses, calculate tax benefits, and file their returns. These tools can simplify the process and reduce the chances of making errors in your tax claims.
Tip: Consider using tax software that includes specific guidance for split custody situations. This software can help you ensure you are claiming the correct deductions and benefits based on your custody arrangement.
7. Consult a Tax Professional
If your split custody arrangement is complex or if you are unsure about how to handle specific tax claims, it’s always a good idea to consult a tax professional. They can help you navigate the intricacies of split custody tax filings and ensure that you are complying with CRA rules.
Tip: Even if you feel confident in your ability to file your taxes, a tax professional can review your return for potential errors or missed opportunities to claim deductions or credits.
8. Plan Ahead for Future Tax Years
Split custody arrangements can evolve over time, and your tax claims may need to be adjusted accordingly. Planning ahead for future tax years can help ensure that you and your co-parent are both receiving the correct benefits and deductions.
Tip: Regularly review your custody agreement and any changes to your financial situation to ensure your tax filings reflect your current circumstances. Make adjustments as needed to avoid any issues down the road.
9. Monitor the CCB and Other Benefit Payments
The Canada Child Benefit (CCB) and other tax benefits may fluctuate based on changes in income, custody arrangements, or the number of children under your care. Monitoring these payments ensures that you receive the correct amount and allows you to quickly address any discrepancies.
Tip: Check the CRA’s online portal periodically to review your benefit payments and ensure they align with your current custody arrangement. If you notice any inconsistencies, contact the CRA promptly to resolve the issue.
10. Stay Informed About Changes in Tax Laws
Tax laws and policies can change from year to year, and it’s essential to stay informed about any updates that could impact your split custody tax claims. New credits, changes to benefit eligibility, or adjustments to deduction limits can all affect your tax filings.
Tip: Sign up for CRA newsletters or follow trusted financial news sources to stay updated on tax law changes. Being proactive about tax updates ensures that you remain compliant and can take advantage of new opportunities.
